The returns for 2 stocks and the Toronto Stock Exchange (TSX) are given in the table...

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The returns for 2 stocks and the Toronto Stock Exchange (TSX) are given in the table below: Return on TSX (%) -3 Year 2017 2018 2019 2020 2021 Return on Stock A (%) -4 5 8 7 6 Return on Stock B (%) -10 3 19 5 4 2 7 9 4 a) What is the beta of stock B? b) What is the correlation between the returns on stocks A and B? c) Given the correlation that you calculated in part b, what can you say about the degree of diversification that could be achieved by combining stocks a and b in a portfolio? (Don't do calculations for part c. I'm looking for a word answer here). The returns for 2 stocks and the Toronto Stock Exchange (TSX) are given in the table below: Return on TSX (%) -3 Year 2017 2018 2019 2020 2021 Return on Stock A (%) -4 5 8 7 6 Return on Stock B (%) -10 3 19 5 4 2 7 9 4 a) What is the beta of stock B? b) What is the correlation between the returns on stocks A and B? c) Given the correlation that you calculated in part b, what can you say about the degree of diversification that could be achieved by combining stocks a and b in a portfolio? (Don't do calculations for part c. I'm looking for a word answer here).

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a Beta of stock B The beta of stock B is 07 This means that stock B is expected to move 07 times as ... View the full answer